500 Billion Tenge Are Being Allocated to Support the Exporters of Kazakhstan

The Chairman of the Board of “Baiterek” National Managing Holding” JSC, Aidar Arifkhanov, told the way 500 billion tenge being allocated for the support of exporters of Kazakhstan will be distributed, as it is informed by the press service of the holding.

“To strengthen the financial and non-financial support of domestic enterprises in the next three years, 500 billion tenge will be allocated, including 470 billion tenge through the tools of Baiterek Holding. Out of this amount, 220 billion tenge is redistribution of the previously allocated repayable funds, including 138 billion tenge to be directed by the Development Bank of Kazakhstan (DBK) and Damu Support Fund (subsidiaries of the Holding) to finance export-oriented projects in 2019, and 41 billion tenge annually in 2020 and 2021,” – noted Aidar Arifkhanov, speaking at the meeting of the Government of the Republic of Kazakhstan.

He also highlighted that 80 billion tenge is a new financing of exporters crediting through DBK in 2020-2021. Meanwhile, in 2018, DBK has already financed 12 projects totaling 87.3 billion tenge in the framework of the support for exporters. And for financing in 2019, the Bank has a portfolio of 18 projects at the amount of 105.8 billion tenge.

During the period from 2014 to 2018, Damu Fund has financed 267 export-oriented projects totaling 100.3 billion tenge within the conditional allocation of funds in second-tier banks. The Fund has a portfolio of 77 projects worth 47.8 billion tenge in the industries such as food production, electrical equipment, chemicals and pharmaceuticals, building materials, and consumer goods industry to continue financing in 2019.

Following the results of 2018, KazakhExport Export Insurance Company having the capital of 43 billion tenge increased the volume of the existing insurance liabilities to 110 billion tenge, which was 2.5 times higher than the company's own capital. This year, due to capitalization and government guarantee, the insurance capacity will be significantly increased.

“Due to the above, this year KazakhExport will provide insurance coverage in the amount of not less than 95 billion tenge; affirmative decisions have already been taken in regard to 15 projects worth more than 16 billion tenge in the first quarter, including 11 enterprises that have not previously been using the support of KazakhExport. Today, KazakhExport’s support covers more than 80 enterprises in all the regions of Kazakhstan in priority sectors of the economy. For instance, in 2018, KazakhExport provided support in the amount of 90 billion tenge, including 49 billion tenge accounted for enterprises of the agro-industrial complex and the food industry,” - explained Aidar Arifkhanov.

According to him, due to the government support measures rendered to the exporters by Baiterek Holding, a series of sectors of the economy have demonstrated a significant increase in exports of processed products. For example, the export of railway engineering products increased by 139% due to the support of Aktyubinsk Rail and Structural Steel Plant and Prommashkomplekt LLP (production of railway wheels). In addition, manufacturers of accumulator batteries, transformers and electrical equipment were supported, which allowed increasing the export of the specified products by 13.4%. The export in the chemical industry also increased by 10.6% due to the support of enterprises for the production of sodium cyanide, polymer products and mineral fertilizers. And exports of food industry products showed an increase of 7.3% due to the support of more than 20 enterprises for the production of beverages, confectionery, vegetable oils, and dairy products.

“Thus, the allocation of 500 billion tenge for the support of exporters is a timely measure that should contribute to a more dynamic growth of non-resource exports in the coming years,” – summarized the head of Baiterek Holding.